Effort to make Pinnacol pay tax in limbo

A plan that would have made Pinnacol Assurance pay state premium taxes appears to be going nowhere fast, but may not be dead, supporters of the idea say.

The Joint Budget Committee earlier this month voted to ask staff to draft a bill that would take away 94 percent of the state-chartered worker’s compensation insurance fund’s exemption from state tax. The remaining 6 percent of the exemption that Pinnacol would have kept was intended to represent the percentage of employers it represents who can’t get coverage anyplace else.

Though that vote was unanimous, the committee later split on a 3-3 party-line vote on actually passing the bill, meaning that it did not make it out as a JBC bill because Republicans opposed it. That, in turn, means that if any of the Democrats on the committee want to carry it forward, they will have to do so individually.

And therein lies the rub. The bill, which would have generated some $3 million a year to help balance the state budget, was presumed to be a “revenue-raising” measure, which would have to start in the House.

Republicans control the House this year, so it probably would be a non-starter if it began there.

But Senate President Brandon Shaffer, D-Longmont, said it may not be that simple. There may be a way it could be introduced in the Democratic-controlled Senate, he said.

“We’re still looking at options,” Shaffer said. “I do not see it as a revenue-raising bill per se.”

In shooting down the bill to make Pinnacol pay tax, the JBC also killed another drafted bill that would have taken away 50 percent of a tax credit given to Colorado-based insurance companies. That would have generated an estimated $20 million to help balance the budget.

Joey Bunch has been a reporter for 28 years, including the last 12 at The Denver Post. For various newspapers he has covered the environment, water issues, politics, civil rights, sports and the casino industry.